Fund EcoMarket
the sustainable, responsible and ethical investment information hub
- Pictet Clean Energy Transition Fund
| Fund Name | SRI Style | Product | Region | Asset Type | Launch Date |  |
|---|---|---|---|---|---|---|
 Pictet Clean Energy Transition Fund |
Environmental Style | SICAV/Offshore | Global | Equity | 14/05/2007 | |
Fund Size: £3474.00m Total screened & themed / SRI assets: £49415.00 Total Responsible Ownership assets: £174795.00 Total assets under management: £224615.00 As at: 31/07/24 Contact: lrichards@pictet.com |
||||||
OverviewAwaiting update from manager (August 2024)
Through our Clean Energy investment strategy, we intend to allocate capital to companies providing attractive investment opportunities in the areas of clean energy production and energy efficiency. These companies’ products and services are expected to have positive societal and environmental impact, either improving health through reduced air pollution or contributing to the transition towards a low-carbon economy and helping to minimize GHG emissions. |
||||||
FiltersFund information |
||||||
PolicyThe primary purpose of a thematic equity strategy is to invest in assets whose returns are influenced by structural forces of change that evolve independently of the economic cycle. In other words, thematic investing focuses on identifying enduring sources of capital growth and investing in themes supported by the tailwinds of global, long-term, secular growth trends. The Clean Energy strategy is entirely focused on the global clean energy transition and climate change mitigation, underpinned by megatrends of Sustainability, Focus on Health, Economic Growth and Technology Development. By actively selecting the best stocks out of a broad and dynamic investment universe, we intend to construct a portfolio with superior risk/return characteristics compared to global equities while having a positive impact on the environment.
Sustainability: Increasing awareness and urgency to respond to climate change The continued use of fossil fuels, and the carbon and particle emissions that result from it, is harmful to both societies and the environment. Concern about climate change is growing, with increasing urgency from civil society, companies and also governments to address this issue. This has been reflected in youth movements and global protests over the last years (e.g. Fridays for Future Movement) amongst civil society, companies that are stepping up their commitments to clean energy (as illustrated by initiatives such as the Renewable Energy 100 coalition), and most notably government commitments towards a clean energy transition and green economy (e.g. European Green Deal, China's Net Zero Carbon announcement). There is a widespread consensus on the need to reduce the environmental impact of generating, transmitting and consuming energy. Despite tight budgets and competition for resources, governments continue to support a move towards less carbon-intensive, more efficient, and cleaner sources of energy. The transition to a lower-carbon world is a powerful trend that is unlikely to be derailed by fluctuations in the global economy. In fact, the resolve of policy makers appears to have strengthened in many regions (e.g. Europe, China, US).
Focus on health: Growing Health Concerns Today more than 90% of the world population lives in areas where the particle levels exceed the World Health Organization's global air quality guidelines. The continued use of fossil fuels is increasing the occurrence of many health issues, such as the respiratory problems that result from air pollution - contributing to millions of premature death each year. As living standards improve and populations start to demand better living environments, health considerations arising from excessive pollution are also playing an increasing role in shaping government regulation in energy and transportation industries.
Economic growth: Rising Energy Demand Global population growth, increasing per capita usage and sustained economic expansion in emerging markets such as India and China are driving the growing demand for energy, which in turn increases GHG emissions and takes air pollution to alarming levels if these are to be based on traditional fossil fuel sources. Cleaner energy sources and energy-efficient technologies are needed to ensure these needs can be met without threatening public health or further contributing to climate change. Furthermore, the vast majority of traditional energy resources are finite and unevenly distributed, making security of supply one of the most pressing concerns for many countries today. Volatile energy prices coupled with the fight against pollution as well as GHG emissions are strong drivers to find alternative sources of power and to reduce energy consumption.
Technological development: Improving Economics Clean energy solutions have seen a remarkable drop in costs to the point where they are economically competitive today. For example, the costs of solar energy have dropped by 80% since 2010, whereas the price of lithium ion batteries (for e-mobility and energy storage) have dropped by 88% over the past 10 years. The solutions that were deemed uneconomically attractive a decade ago, have become some of the most cost-competitive and economically sensible solutions today thanks to improved technology and innovation.
|
||||||
ProcessWe first identify an initial universe of listed companies that help the transition towards a lower-carbon economy. Defining the theme ensures that only companies with sufficient exposure to Clean energy-related activities are eligible for investment.
We include companies in the investable universe only if at least 33% of the sales (or Enterprise Value, EBIT or EBITDA) is derived from products & services that support the transition to a lower carbon economy. By applying the positive screen, we narrow the universe down from 40,000 to 250 companies with high exposure to the theme.
When defining the investment universe of Thematic strategies, we systematically exclude stocks that have negative impacts on the environment or society. If a company’s revenues generated by such activities are above the threshold, the company is excluded from the universe. Some sectors that are often considered low-carbon energy sources are not included in our investment universe. This concerns in particular nuclear energy. Nuclear power plants do not emit greenhouse gases but generate highly radioactive waste that remains active for thousands of years. Therefore, we do not consider nuclear power a sustainable solution. Furthermore, since 2019 natural gas bhas been removed from our investment universe, which has overall improved the environmental profile of the portfolio. Companies that invest Growth Capex in new coal mine or power plant developments projects are also excluded from the Clean Energy investment universe. We also exclude companies in severe material breach of UN Global Compact Principles on human rights, labour standards, environmental protection and anti-bribery/corruption. Exclusions are based on reliable sources gathered from reputable third-party research providers. Pictet AM retains full discretion over exclusions and always reserves the right to deviate from third party information on a case by case basis. |
||||||
Resources, Affiliations & Corporate StrategiesPictet Asset Management has a dedicated ESG Team which leads and co-ordinates implementation of our responsible investment policy, including ESG integration in investment processes, ownership practices, risk management and reporting tools. The ESG Team reports directly to Sébastien Eisinger, Managing Partner Pictet Group, Co-CEO Pictet Asset Management and Head of Investments. Key responsibilities include: Investments
Active Ownership
Pictet Asset Management has been a signatory of the UNPRI since 2007. In addition, Pictet Asset Management actively participates in several investor initiatives aimed at sharing best practices between asset managers and owners and encouraging corporate disclosure on ESG issues. We are notably involved in the IIGCC (Institutional Investors Group on Climate Change), SSF (Swiss Sustainable Finance) and similar organisation in the UK, Germany and Spain.
Pictet Group and / or Pictet Asset Management supports and actively participates in international and national initiatives, organisations and partnerships including the below (which indicates Pictet’s involvement, year joined and key areas of focus) :
Source: Pictet Asset Management, [April 2023]
Other industry associations:
Furthermore, Pictet, together with Swiss Sustainable Finance, was leading an initiative to put pressure on index providers to remove controversial weapon manufacturers from mainstream indices. The initiative, launched in August 2018, secured the backing of 174 signatories controlling over USD 9.7 trillion and including international asset owners and managers (as of January 2020). This initiative has now been closed due to inclusion of controversial weapons exposure disclosures in draft RTS and EU Benchmarking regulation.
|
||||||
LiteratureLast amended: 21/06/24 09:58 |
||||||
Important information
This report is for information purposes only and is intended to complement existing services used by UK based financial advisers only. sriServices is not authorised to give investment advice. The information on this site does not in any way constitute advice, recommendation or endorsement of any product or service. Investment decisions should not be based on this information alone. sriServices cannot be held in any way responsible for decisions made or advice offered as a result of using this site.
Whilst we take care to ensure information is as accurate as possible at time of publication we recommend you/financial advisers confirm specific fund details with fund providers. Please see www.sriServices.co.uk for additional information and for our contact details.
© Copyright sriServices 2025
04/30/2025